Econet lashes out at banks on mobile money

ECONET Wireless Zimbabwe (Econet) has lashed out at banks for proposing amendments to government's banking reforms to include mobile money service providers, saying it was a selfish attempt by a clique of individuals to frustrate its operations.

Econet owns EoCash, a mobile payments service.

In his national budget statement Finance minister Tendai Biti said banks should, effective this year, not levy fees on deposits of less than US$800 and give 4% interest on deposits of at least US$1 000 held over 30 days. He also said banks should issue debit cards for free and scrap the deposit protection fund cap.

Bankers Association of Zimbabwe (Baz) said they would, among other things, incur huge losses as a result of the legal changes given that most of their income came from tariffs. In a position paper, Baz argued mobile money services should be bound by the same regulations in order to create a level playing field while recent media reports indicate bankers are lobbying for all mobile money services to be administered by a financial institution, otherwise they become direct competition to conventional banking.

Econet has responded by saying regulators should not be swayed by selfish interests of a minority group wishing to keep ordinary people from enjoying the benefits of their mobile money technology, while offering no meaningful alternative solutions or even willing to invest anything.

"Econet is aware there is a small number of individuals, mostly associated with one foreign-owned financial institution, who have lobbied intensely both before and after the introduction of this vital (EcoCash) service yet this very same institution, motivated only by what we believe is selfishness, has never shown any inclination whatsoever in its long existence in Zimbabwe to develop services that are inclusive and serve the majority of Zimbabweans," said the country's largest mobile network provider in response to businessdigest's questions.

"The so-called complaints of a small minority of banks are reminiscent of the complaints of the then PTC management when Econet founder Strive Masiyiwa was trying to introduce cellphones in Zimbabwe. If he had not fought tenaciously, over 10 million people would today not have access to a phone."

According to the mobile phone operator's statistics, EcoCash has enabled nearly two million Zimbabweans, the majority of who did not have bank accounts, to have access to basic financial services.

Most of the EcoCash subscribers live in rural areas where there are no banking facilities, making the facility their economic life line.

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